Diesel Fuel Still Pricey, Hurting State's Trucking Industry

Gasoline prices in Connecticut have been steadily falling — down $1 Friday since peaking in July — and so have diesel fuel prices.

Just not as much.

Diesel still costs about 76 cents a gallon more than regular gas in Connecticut, according to AAA, averaging about $4.14 a gallon in the state on Friday. Federal energy officials expect diesel to cost significantly more than regular gas well into 2009, especially as residents clamor for heating oil for the coming winter. Heating oil and diesel are basically the same commodity.

This has left the state's trucking industry under siege.

Amodio Moving Inc., a New Britain moving company, is auctioning its equipment in two weeks. Another moving company, Salka & Sons in Meriden, shut its doors this year, and a Canaan tanker-truck company, Hitchcock Bros., went out of business last year, said Mike Riley, president of the Motor Transport Association of Connecticut.

"Some companies have parked their trucks. Others have maximized the speed drivers can drive their trucks and delayed some shipments until they can fill up a truck, rather than going out with half-empty trucks," Riley said. "In some cases, they're just throwing their hands up and saying, 'I'm outta here.'"

The gap between diesel and gas prices has grown in recent years for several reasons, said Jonathan Cogan, a spokesman for the federal Energy Information Administration.

The diesel market has witnessed much stronger demand than gas as European countries began switching to diesel-fueled cars. This, mixed with a limited supply of diesel on the market, has driven up prices, he said.

Diesel prices have also traditionally surged during the winter heating season because heating oil is virtually the same product, he said. New regulations that require refiners to supply ultra-low-sulfur diesel has added a cost to production.

Consumers have become the ultimate sufferers as truckers increase fuel surcharges to deal with their own rising costs. Those surcharges are then reflected in the final prices that customers see in grocery stores and other retail outlets.

"Virtually every trucking company I've seen, unless they're completely crazy and bleeding to death, has increased its fuel surcharge, which applies to all of its customers — movers, construction companies, freight haulers," Riley said.

Anthony Petruzzello, who owns a 10-truck company, Petruzzello Transport Inc. in Bethany, said he has been trying to cover costs through his fuel surcharge as much as possible. But his company is still taking a hit — an estimated 20 percent drop in sales, compared with last year — forcing him to lay off workers and cut his truckers' driving speed from 72 to 64 mph.

"We've been in business for 45 years," he said, "and this has been about the toughest."

Truckers across the nation are feeling the same squeeze.

Harold Bishop of Timberville, Va., while picking up a load of produce at the Hartford Regional Market in June, said he couldn't afford to fill up his tank, buying diesel instead in $400 to $500 increments.

"They say, for every 10 cents that a gallon of diesel fuel goes up, this country loses a thousand small carriers," he said. "I've seen good times and bad, and right now, it's not too good. But what do you do? It's sad, very sad."

On The WebFor an audio slideshow on the trucking industry, visit courant.com/secondlook